Section 80D: Tax Benefits on Health Insurance & Medical Treatments by SAG Infotech


Income-tax Act, 1961 has provisions for tax relief under Section 80 D, Section 80 DD and Section 80 U for medical purposes. Let us check out the complete section-wise benefits on income tax of all the medical insurance provisions and expenses on medical treatment taken by the insured or general people.

 

  • Under Section 80 D, deductions can be claimed for purchasing medical insurance policies for self and dependent for a premium of upto Rs 25000/- per annum. This can be increased upto Rs 50000/ in case of resident senior citizens or parents being dependent. Expenses for preventive health checkup of upto Rs 5000/- for self and family and /or parents can be claimed under tax deductions. Medical expenditure deduction of upto Rs 50000/- on self and/or family and an additional Rs 50000/- to be availed for parents’ health.
  • Under Section 80 DD deduction upto Rs 75000/- Rs 1,25000 is allowed for dependent who are differently abled for their treatment, maintenance, etc.
  • Under Section 80U, a deduction of upto Rs 75000/- is allowed to a person with a specific disability or special needs if certified by specific medical authorities.

 

Essentials for Claiming the Deductions:

 

  • Health Insurance Scheme that you purchase, should be specified by the Central Government and approved by IRDA.
  • Payment should be made through account and never by cash. The account statement, in that case, comes handy in claiming deduction as a proof of payment being made for the purchase.
  • Senior Citizen is refers to people having attained the age of 60 in the prevalent financial year.
  • Premiums paid for relatives other than dependent like brother, sister,etc cannot be claimed.
  • If children are not dependent, premiums paid for them cannot be claimed.

 

Salaried people get the medical insurance policy from employer either:

 

  • Direct payment to medical insurance company
  • Reimbursement of premium to the employee. These premiums are essentially tax exempted perks. The employer can consider such a deduction while deducting TDS on taxable salary.
The tax deductions are computed by the employer as TDS on taxable salary. It can alternatively be claimed through return by the employee at the end of that particular financial year.

 

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